Wednesday, August 24, 2016

This Summer's Notable Decisions Regarding Pre-judgment Interest, Appellate Procedure and Other Issues

The Appellate Courts release fewer decisions and with less frequency during the summer months. Below are a few of this Summer's notable decisions. 

Second Department Concludes That Pre-Judgment Interest Is Not Triggered By a Stipulation of Liability

In Mahoney v. Brockbank, the defendant stipulated to liability in exchange for plaintiff’s stipulation to discontinue a cause of action against defendant for punitive damages. Approximately 2 ½ years later, a trial on damages was held, resulting in an award in favor of plaintiff on damages.  Both sides submitted proposed judgments. The plaintiff’s proposed judgment included pre-judgment interest calculated from the date of the stipulation. The defendant’s proposed judgment included interest from the date of the jury verdict on damages. The trial court signed the defendant’s judgment and the plaintiff appealed.

The Second Department observed that CPLR 5002 governs pre-judgment interest “from the date the verdict was rendered or the report or decision was made.” The Court further observed that there are extensive cases regarding what constitutes a verdict, report or decision including decisions on motions for summary judgment, to enter default judgment and to strike defendant’s answer; decisions on unopposed applications for a directed verdict on liability; binding arbitrators’ awards; confirmation of a referee’s report; and the decision of an Appellate Court reversing the denial of a plaintiff’s motion for summary judgment on liability. The Second Department noted that each of these was an adjudication by a jury, court or arbitrator.

By contrast, in the present case, the stipulation was not an adjudication of liability – it was an agreement between the parties. Had the Legislature intended to include stipulations in CPLR 5002 it could have done so. Therefore, finding that it was significant that the Legislature had omitted stipulations from CPLR 5002, the Second Department concluded that the stipulation did not trigger an obligation to pay pre-judgment interest, and instead pre-judgment interest was properly calculated from the date of the jury verdict on damages.

Second Department Holds that Denial of Untimely Appeal Is Not an Adjudication on the Merits

In Mosby v Parilla, the Second Department points to a noteworthy distinction between an appeal that is dismissed because of a failure to timely perfect and an appeal that is dismissed because it was not timely taken. Here, the jury found for plaintiff in a medical malpractice suit. The defendant then moved, pursuant to CPLR 4404(a), to have the verdict set aside. While the 4404(a) motion was still pending, plaintiff caused judgment to be entered and defendant appealed. The Second Department subsequently dismissed defendant’s appeal as untimely, but the lower court granted defendant’s earlier CPLR 4404(a) motion and the verdict was set aside as a matter of law.

Plaintiff appealed, stating that the Second Department’s dismissal of defendant’s untimely appeal precluded the Supreme Court from subsequently granting defendant’s 4404(a) motion. In holding for defendant, the Second Department noted that the “dismissal of an appeal as untimely does not constitute an adjudication on the merits” (unlike the dismissal of an appeal for a failure to perfect) and therefore the CPLR 4404(a) motion survived the collateral estoppel arguments raised by plaintiff.

Second Department Holds that Contractor Did Not Exacerbate Dangerous Condition

In Barone v Nickerson, plaintiff was injured when he tripped and fell while ascending stairs, which defendant was hired by the property owners to repair. Defendant was a third party whose contractual obligations were to the property owners, not the plaintiff. Plaintiff brought an action against defendant and the trial court granted defendant’s motion for summary judgment.

On appeal, plaintiff claimed that defendant fell within one of the three Espinal exceptions, which may give rise to tort liability under contractual obligations of third parties: “(1) where the contracting party, in failing to exercise reasonable care in the performance of his [or her] duties, launches a force or instrument of harm, (2) where the plaintiff detrimentally relies on the continued performance of the contracting party's duties, [or] (3) where the contracting party has entirely displaced the other party's duty to maintain the premises safely" (Espinal v Melville Snow Contrs., 98 NY2d 136 (2002)). Specifically, plaintiff alleged that defendant had violated the first factor by exacerbating the dangerous condition. Defendant was then required to make a prima facie showing negating only the applicability of the exception “expressly pleaded” by the plaintiff. In holding for defendant, the Second Department held that defendant had met his burden by showing that he did not leave the steps or handrail in a condition more dangerous than he had found it.

First Department Grants Partial Summary Judgment of Non-culpability for Innocent Driver

Oluwatayo v Dulinayan involved a motor vehicle accident, where plaintiff was rear-ended by defendant driver who was also rear-ended by another co-defendant driver. Plaintiff sought summary judgment on liability against both drivers. The lower court denied the motion, as plaintiff failed to meet his burden of eliminating triable issues of fact.

On appeal, the First Department, although agreeing with the lower court that there were triable issues of fact relating to the proportional fault of each defendant driver, held that the plaintiff was entitled to partial summary judgment under CPLR §3212(g) (“Limitation of issues of fact for trial”). In reviewing a series of cases involving innocent plaintiff passengers, the court stated the fact that the plaintiff driver here was rear-ended, while stopped was analogous to other cases where passenger plaintiffs were “entitled to a determination that [plaintiff] had no culpable conduct on the issue of liability irrespective of the unresolved issue of a defendant driver's negligence.” Unlike the innocent passenger cases, however, plaintiff here failed to establish the proportionality of fault of each defendant driver. Plaintiff was granted partial summary judgment “to the extent of finding no culpable conduct by plaintiff on the issue of liability.”

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